China's iPhone deal: New details emerge
The headlines out of China overnight Tuesday were headsnappers.
First Shanghai Security News reported that Apple (AAPL) had reached a three-year deal with China Unicom to market the iPhone in the world's largest cellphone market (600 million-plus subscribers).
Then AFP and Reuters reported what China Unicom's spokesperson told them: that the two companies were still in negotiations and no agreement had been reached (something, by the way, any company dealing with Apple will say before Cupertino has had a chance to break the news itself).
What's important in all this, says iPhonAsia's Dan Butterfield, a veteran China watcher, are the details leaking through the cracks.
"File this under rumor," he warned in an item posted Monday, before the wire services caught on to the story.
Then he listed the key takeaways from Tech.QQ, a Chinese blog quoting "informed sources" who claim a deal has been reached to launch the iPhone in China by the end of September 2009.
- The Apple and China Unicom deal will be a 3-year exclusive.
- The iPhone will be customized for the China market (e.g. Chinese language and preloaded with “for China” apps).
- China Unicom will pay Apple 3,000 CNY ($439 USD) per unit.
- China Unicom will subsidize iPhone by pricing the iPhone below the 3,000 CNY paid to Apple. This would take the official iPhone price below the grey-market price for smuggled iPhones.
- China Unicom has promised to sell a minimum 1 million units per year with significantly higher sales targets.
- The iPhone for China will make use of Apple’s China App Store. (link)
Butterfield notes that in terms of exclusivity, it's not clear whether the deal would be for all iPhones or 3G models only, leaving the door open for an unlocked 2G model in 2010/11 for all carriers, including giant China Mobile.
Nor does the report mention when China’s Ministry of Industry and Information Technology (MIIT) might grant Apple’s iPhone the required Network Access License (NAL).
When the markets opened in Hong Kong Tuesday, traders bid China Unicom's stock up 1.5%
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Wow, there's a disconnect between your data and your conclusion.
Jason wrote, "I polled 10 of my friends stilll living in Beijing and Shanghai, who said that interest in the iPhone is high (because it is American), but it’s more of an interest to play around with the phone that to actually want to purchase it. I think it will be an epic #fail."
So, you know what your friends want, better than they know themselves? Perhaps, you are coloring your analysis with your own biases?
Will the iPhone even be a big success in China? I spent a year of my life living in Beijing, when no one had an interest in the phone. China is a Microsoft lover and besides that, what they expect out of a phone, is much different than what the West is interested in. Here is why I think it will fail…http://tinycomb.com/2009/07/28/iphone-inches-closer-to-china-deal-but-here-is-why-it-will-fail/
Make sure any iPhone/China Unicom headlines are ended with a question mark. These rumors are taking on a life of their own.
We focus on shanzhai products in China on our site. We’ve just written an article on how we think that a legitimate iPhone in China will likely spur even further growth in the iFauxne market.
Cheers,
Tai-Pan
http://www.shanzai.com